After a string of failed attempts to cap the damaged well, the energy giant is battling to contain the six-week-old leak, now the worst in US history, with robotic submarines working on the sea bed.
But they became bogged down on Wednesday when the saw being used to cut through the fractured riser pipe became stuck, Coast Guard official Thad Allen told reporters.
News that makes sense
Your trusted source for staying up-to-date with the world around you. Get free daily news updates and analysis, straight to your inbox.
"Anybody that's ever used a saw knows every once in a while it will bind up. That's kind of what's happening here," he added.
The diamond wire saw is being used to cleanly cut off the ruptured riser pipe at the top of a failed blow-out preventer.
Oil to be siphoned off
A first cut was successfully made overnight, and Allen said he expected the saw would be extracted, or a new one would be sent down to the wrecked wellhead later.
The next step will be to try to cap the end of the pipeline and then siphon the oil to a containment ship on surface.
News of the latest setback came as Florida faced up to the threat of environmental disaster on its shores as the oil slick closes in.
Florida Governor Charlie Crist warned that forecasters "are projecting weathered oil from the leading edge could impact the Florida Panhandle as early as this week, possible in a day or two".
"We are watchful, we are monitoring the situation, and we will do everything to protect our beautiful state," he told a press conference, warning "thousands of tar balls" could be approaching the state.
The latest official projections from the National Oceanic and Atmospheric Administration (NOAA) show the slick to be about 11km off the state's shores.
Florida in path of spill
Florida would be the fourth state hit by the oil since an April 20 explosion ripped through the Deepwater Horizon rig, 80km off the Louisiana coast, killing 11 workers.
More than 200km of Louisiana coastline has been contaminated, triggering fears for the region's already endangered wildlife.
"The threat is shifting to Mississippi and Alabama," said Allen, who is overseeing the government's response to the crisis.
Emulsified oil has been found on Petit Bois Island in Mississippi, while tar balls and sheen were spotted 16km south of Fort Morgan, Alabama.
All oyster beds and beaches around Dauphin Island, Alabama, have also been closed as officials battle to deploy more boom to protect the shorelines from the encroaching crude.
Criminal investigation
The massive spill has frayed the nerves of local residents, who wonder if their lives will ever return to normal.
"Everybody is so stressed here. We're just sitting here waiting and they're not telling us anything because they don't know. I had four people who came yesterday crying," said restaurant owner Annette Rigaud, who may be forced to close down.
BP's chief operating officer Doug Suttles acknowledged that until the cap is in place the flow of oil into the Gulf would likely increase by as much as 20 per cent.
The US government, which has launched a criminal investigation into the disaster, has estimated the flow of oil before the riser was cut away at 12,000 to 19,000 barrels a day - meaning at least 20 million gallons have already poured into the Gulf since April.
"I think if this works, we should capture the vast majority of the flow," Suttles said on CNN Tuesday.
"We can't say it'll capture all of it, because it's not a tight mechanical seal, but if it functions well it should capture the vast majority of the flow."
BP boss 'sorry' for gaffe
President Barack Obama meanwhile vowed to find the votes to pass a stalled energy bill, saying the oil catastrophe showed the need to "aggressively" seek a clean energy future.
"The only way the transition to clean energy will succeed is if the private sector is fully invested in this future - if capital comes off the sidelines and the ingenuity of our entrepreneurs is unleashed," he said.
Under-fire BP chief executive Tony Hayward also apologised for saying in an interview that he would "like my life back".
"I made a hurtful and thoughtless comment on Sunday when I said that 'I wanted my life back,'" Hayward said in a post to BP America's Facebook page.
"When I read that recently, I was appalled. I apologise, especially to the families of the 11 men who lost their lives in this tragic accident," he said.
